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Re: [XP] How do you charge a customer on XP projects?

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  • Niklas Bjornerstedt
    There is a lot of interesting stuff about contracts for agile projects on the net. The problem is that it is fragmented, no one has collected this into a more
    Message 1 of 4 , Nov 2, 2009
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      There is a lot of interesting stuff about contracts for agile projects on the net. The problem is that it is fragmented, no one has collected this into a more comprehensive overview. Here is one interesting paper and slide set from this years Agile2009 conference:

      http://www.bestbrains.dk/dansk.aspx/Artikler

      /Niklas
      www.leanway.no

      --- In extremeprogramming@yahoogroups.com, Ron Jeffries <ronjeffries@...> wrote:
      >
      > Hello, Joshua. On Sunday, November 1, 2009, at 7:06:49 AM, you
      > wrote:
      >
      > > As I have read on many XP books, with XP we actually charge customer
      > > based on scope.
      >
      > I'm not sure what books actually say how to charge customers but
      > certainly in every project, actual cost (if not charges) is
      > proportional to scope.
      >
      > > But how does this differ from traditional project
      > > management?
      >
      > As far as I can see, it differs in just about every possible way.
      > Traditional project management generally seems to suggest up front
      > planning and setting of price, date, and scope. XP does none of
      > those things.
      >
      > > With traditional/waterfall project management we charge
      > > customer based on fixed price, because everything is calculated and
      > > estimated upfront.
      >
      > ... incorrectly calculated, generally. If you have the ability to
      > calculate those things correctly, I'd say go ahead and do it and
      > teach the rest of us. :)
      >
      > > So if we miss the deadline, it is the consultant's
      > > responsibility.
      >
      > Traditional fixed price contracts do try to set up this
      > relationship. It's not actually accurate, as the results of a
      > contract belong to everyone involved.
      >
      > > Does this mean we can't or don't charge customer with
      > > fixed price on XP? Does that mean we charge them with man/hours?
      >
      > It would be possible to charge a fixed price: We'll do what we can
      > do for $50,000, and you the customer get to choose the stories.
      >
      > It would be possible to do the same with a fixed date: We'll work
      > from now till New Years, at $50,000 a month, and you get to choose
      > the stories.
      >
      > It is possible, certainly, to charge in terms of person hours, and
      > let the customer decide when to stop.
      >
      > > Is there any detailed resources on how we charge the customer on
      > > XP/Agile projects? Any guidance and insights on this topic would be
      > > very helpful.
      >
      > I can't think offhand of anything substantial written on the subject
      > ... perhaps others will have some pointers.
      >
      > Ron Jeffries
      > www.XProgramming.com
      > www.xprogramming.com/blog
      > To follow the path:
      > Look to the master; Follow the master; Walk with the master;
      > See through the master; Become the master. -- Modern Zen Poem
      >
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